design challenges.ppt

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4-Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall 1

Organizational Theory,

Design, and Change

Sixth Edition

Gareth R. Jones

Chapter 4

Basic Challenges ofOrganizational

Design


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Diferentiation

Diferentiation: he process by !hichan organi"ation allocates people andresources to organi"ational tas#s andestablishes the tas# and authority

relationships that allo! the organi"ationto achie$e its goalsDivision o labor: the degree o%

speciali"ation in the organi"ation In a si&ple organi"ation, di'erentiation is lo!

because the di$ision o% labor is lo! Indi$iduals typically per%or& all organi"ational tas#s

In a co&ple( organi"ation, di'erentiation ishigh because the di$ision o% labor is high


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Figure 4.1: DesignChallenge


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Figure 4.1: DesignChallenge (cont.)


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Organizational Roles

he basic building bloc# o% di'erentiationare organi"ational roles

Organizational Roles: the set o% tas#-

related beha$iors reuired o% a personby his or her position in an organi"ation /s the di$ision o% labor increases, &anagers

speciali"e in so&e roles and hire people to

speciali"e in others peciali"ation allo!s people to de$elop

their indi$idual abilities and #no!ledge!ithin their specic role



Organizational Roles(cont.)3rgani"ational structure is based on a

syste& o% interloc#ing roles and theseroles deter&ine authority and control

Authority: the po!er to hold peopleaccountable %or their actions and to&a#e decisions concerning the use o%organi"ational resources

Control: the ability to coordinate and&oti$ate people to !or# in theorgani"ations interests


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Subunits: Functions andDivisions

5oles are typically grouped into subunits Function: a subunit co&posed o% a group

o% people, !or#ing together, !ho possesssi&ilar s#ills or use the sa&e #ind o%

#no!ledge, tools, or techniues to per%or&their 6obs Division: a subunit that consists o% a

collection o% %unctions or depart&ents thatshare responsibility %or producing a

particular good or ser$ice Organizational complexity: the nu&ber

o% di'erent %unctions and di$isionspossessed by an organi"ation

7egree o% di'erentiation



Diferent !inds o"Functions Support unctions: %acilitate an organi"ations control

o% its relations !ith its en$iron&ent and its sta#eholders Purchasing, sales and &ar#eting, public relations, and legal

a'airs ro!uction unctions: &anage and i&pro$e the

e8ciency o% an organi"ations con$ersion processes sothat &ore $alue is created

Production operations, production control, and ualitycontrol

"aintenance unctions: enable an organi"ation to#eep its depart&ents in operation

Personnel, engineering, and 6anitorial ser$ices

A!aptive unctions: allo! an organi"ation to ad6ust tochanges in the en$iron&ent

5esearch and de$elop&ent, &ar#et research, and long-range planning

"anagerial unctions: %acilitate the control andcoordination o% acti$ities !ithin and a&ong depart&ents

/cuisition o%, in$est&ent in, and control o% resources



Figure 4.#: $uilding $loc%s o"Diferentiation


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&ertical and 'orizontalDiferentiation #ierarchy: a classication o% people

according to their relati$e authority and ran#

$ertical !iferentiation: the !ay anorgani"ation designs its hierarchy o% authority

and creates reporting relationships to lin#organi"ational roles and subunits Establishes the distribution authority bet!een

le$els

#orizontal !iferentiation: the !ay an

organi"ation groups organi"ational tas#s intoroles and roles into subunits 9%unctions anddi$isions:

5oles di'erentiated according to their &ain tas#responsibilities



Figure 4.: OrganizationalChart o" the $..R. and*rille


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Figure 4.4: OrganizationalDesign Challenges


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$alancing Diferentiationand +ntegration Hori"ontal di'erentiation is supposed to

enable people to speciali"e and beco&e &oreproducti$e peciali"ation o%ten li&its co&&unication bet!een

subunits People de$elop subunit orientation Subunit orientation: a tendency to $ie! ones role

in the organi"ation strictly %ro& the perspecti$e o% theti&e %ra&e, goals, and interpersonal orientations o%ones subunit

;hen subunit orientation occurs, co&&unication%ails and coordination beco&es di8cult

%ntegration: the process o% coordinating$arious tas#s, %unctions, and di$isions so thatthey !or# together and not at cross-purposes



,-es o" +ntegration/echanis0s

#ierarchy o authority: dictates

acti$ities Proble&atic that a &anager in one %unction has no authority

o$er a &anager in another

&iaison roles: a specic &anager is gi$en responsibility %orcoordinating !ith &anagers %ro& other subunits on behal%o% their subunits

'as( orce: &anagers &eet in te&porary co&&ittees tocoordinate cross-%unctional acti$ities

as# %orce &e&bers responsible %or ta#ing coordinatingsolutions bac# to their respecti$e %unctions %or %urther input andappro$al

'eams: a per&anent tas# %orce used to deal !ith ongoingstrategic or ad&inistrati$e issues

%ntegrating role: a ne!, %ull-ti&e role established toi&pro$e co&&unications bet!een di$isions

>ocused on co&pany-!ide integration

%ntegrating !epartment: a ne! depart&ent intended tocoordinate the acti$ities o% %unctions or di$isions

Created !hen &any e&ployees enact integrating roles



$alancing Diferentiation and+ntegration ?anagers &ust t le$el o%

integration and le$el o%di'erentiation

7i'erentiation and integration&ust be balanced

Co&ple( organi"ations need &ore

integration i&ple organi"ations need less

integration



$alancing Centralizationand Decentralization Centralize! organization: the authority to

&a#e i&portant decisions is retained by tople$el &anagers op &anagers able to coordinate acti$ities to #eep

the organi"ation %ocused on its goals

Decentralize! organization: the authorityto &a#e i&portant decisions is delegated to&anagers at all le$els in the hierarchy Pro&otes @e(ibility and responsi$eness

Ideal balance entailsA Enabling &iddle and lo!er &anagers !ho are at

the scene o% the action to &a#e i&portant decisions /llo!ing top &anagers to %ocus on long-ter&

strategy &a#ing



$alancing Standardizationand /utual dust0ent Stan!ar!ization: con%or&ity to

specic &odels or e(a&ples that areconsidered proper in a gi$en situation 7ened by rules and nor&s

"utual a!)ustment: the processthrough !hich people use their

6udg&ent rather than standardi"edrules to address proble&s, guidedecision &a#ing, and pro&otecoordination

Formalization: the use o% rules and

procedures to standardi"e operations



$alancing Standardization

and /utual dust0ent (cont.) ociali"ationA Bnderstood or&s

Rules: %or&al, !ritten state&ent thatspeci%y the appropriate &eans %orreaching desired goals

*orms: standards or styles o% beha$iorthat are considered typical %or a group o%people ?ay arise in%or&ally E(ternal rules &ay beco&e internali"ed nor&s

Socialization: the process by !hichorgani"ational &e&bers learn the nor&so% an organi"ation and internali"e theseun!ritten rules o% conduct



Standardization versus/utual dust0ent Challenge %acing &anagers isA

o nd a !ay o% using rules andnor&s to standardi"e beha$ior, and

to allo! %or &utual ad6ust&ent togi$e &anagers opportunity todisco$er ne! and better !ays to

achie$e goals


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/echanistic and OrganicOrganizational Structures"echanistic structures:

designed to induce people tobeha$e in predictable, accountable

!aysOrganic structures: structures

that pro&ote @e(ibility, so people

initiate change and can adaptuic#ly to changing conditions


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Figure 4.2: 'o3 the Design ChallengesResult in /echanistic and OrganicStructures


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Contingenc- roach

/ &anage&ent approach in !hich the designo% an organi"ations structure is tailored tothe sources o% uncertainty %acing anorgani"ation

3rgani"ation should design its structure to tits en$iron&ent


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Figure 4.1: Relationshi $et3een5nviron0ental 6ncertaint- and

Structure

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